WellPoint, Aetna led U.S. insurers in coverage denial

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WellPoint Inc., Aetna Inc., Humana Inc. and UnitedHealth Group Inc. denied health coverage to 49 percent more people over the past two years, citing pregnancy or plans for adoption among their reasons, a U.S. report found.

The insurers rejected 651,000 applicants from 2007 to 2009 for illnesses or conditions they had before applying for coverage, according to the report by the House Energy and Commerce Committee, led by Rep. Henry Waxman, a California Democrat. Each company had a business plan to exclude pre-existing conditions, according to the report.

A Bloomberg National Poll released Wednesday found voters favor by a 47 percent to 42 percent margin repealing the health-care overhaul law Democrats passed, adding to Republicans’ momentum to take control of Congress in the Nov. 2 elections. The report may help Democrats focus the public on the law’s more-popular provisions, among them a ban on insurers denying coverage due to medical conditions, said Peter Harbage, a health-care consultant in Sacramento, Calif.

“For Republicans running on a repeal health-reform platform, the report forces them to tell voters why insurers should be able to deny coverage to those who need it the most,” said Harbage, previously an adviser to John Edwards, the disgraced former Democratic presidential candidate. The report cited internal insurer documents the panel obtained.

The companies turned down 257,100 people last year who sought to buy benefits on their own and not through employers, the House report said. They denied 172,400 applicants in 2007, the report said. Enrollment increased by 16 percent in that time, according to the committee.

Insurers agreed to end denials for pre-existing conditions early in the health-care debate last year, said Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, the industry’s trade group in Washington, D.C. Until all consumers are required to buy health insurance, the coverage restrictions are needed to keep people from gaming the system, he said.

“In the current individual market, applicants undergo an underwriting process to discourage people from purchasing coverage only after they need medical services, which drives up costs for all policyholders,” Zirkelbach said.

Donald Nathan, a UnitedHealth spokesman, declined to comment. Jill Becher a  spokeswoman for Indianapolis-based WellPoint, and Jim Turner, a spokesman for Humana, referred questions to the trade group.

The House reports “document what many health insurers, including Aetna, have been saying for years—that the individual market needs to be reformed so we can improve access for all consumers,” said Fred Laberge, an Aetna spokesman, in an e-mail. “Improving access without also addressing the underlying issue of rising medical costs will lead to higher premiums for many consumers.”

One company cited “improved pre-existing exclusion process” as a way to increase business, said the report. One of the companies had a list of 425 conditions that could be used to deny people insurance coverage, including pregnancy, diabetes and heart disease.

Other documents in the report showed that people who were surgical candidates, pregnant, female and “treated for infertility within the past five years,” and “any applicant with a (body mass index) 39.0 or greater” were denied health insurance without any internal review by the company. The committee obtained the documents in response to letters Waxman sent in March. The report didn’t specify the insurers that carried out the actions.

The economy’s weakness probably pushed health plans to deny more applicants, said Harbage, the consultant, whose clients include not-for-profit foundations and unions. Healthy customers were more likely to drop coverage over the past few years, leaving insurers with sicker customers more likely to drive up medical costs, he said.

“Insurers looked for more ways to manage their risk and profit,” he said. “The result is that many people who needed coverage were turned away.”

Even as a plurality supported the health overhaul’s repeal, the Bloomberg poll found strong backing for most of the law’s provisions. Three-quarters favor its ban on insurance companies denying coverage because of pre-existing conditions; 67 percent support allowing children as old as 26 to stay on their parents’ policies. Also, 73 percent want to keep the addition of more prescription-drug benefits for those on Medicare, the U.S. government’s health program for the elderly and disabled.

The survey of 721 likely voters was conducted for Bloomberg on Oct. 7-10 by Selzer & Co., a pollster based in Des Moines, Iowa. It has a margin of error of plus or minus 3.7 percentage points.

The four insurers treat pregnancy as a pre-existing condition and generally don’t offer coverage to expectant mothers, the House committee said in a second memo that cited company documents.

Expectant fathers and those about to adopt are often denied as well, and documents show the companies have moved to limit the availability of riders that can be bought to add maternity coverage, the report said. One rider limited a woman to $6,000 in maternity benefits after she paid extra premiums for four years, the report said.

In company documents, executives said maternity coverage resulted in “higher prices, lower margins and loss of market share,” the report said. Another document said one insurer typically spent 90 percent of the premiums it collects on medical care for policies with optional maternity benefits, “a money-losing ratio.”


  • I'm ashamed Susan Bayh is with Wellpoint
    For many years Susan's membership on several major corporate boards (eight of them, in 2008) was something of an open secret. Only over the course of the health care reform debate was it widely spoken about in Indiana. With Bayh playing a prominent role in the haggling over the public option and medical device fees, it was impossible to ignore the fact that WellPoint, a behemoth insurer, was paying Susan Bayh hundreds of thousands of dollars.

    Between 2006 and 2008 Susan earned $2.1 million from health insurers. Legal under Senate rules, Susan Bayh's refusal to step down from WellPoint's board, and her husband's denial that the millions she had earned from WellPoint would influence him, were greeted with derision from ethics watchdogs.
  • To Concerned Citizen:
    What are all those funny marks on your post? Which talking points did you cut and paste it from? For whom are you speaking?
  • there they go again
    By all means, Daniel (Coats, is it?) let's compare driving a car with getting chemo to beat cancer or other essential meds or treatments to function physically or mentally. Isn't such a false comparison called a red herring or something?
  • Some questions on HCR
    Letâ??s for a moment take a common sense look at the so called â??Healthcare Reformâ?? bill that was passed, and signed into law on March 23rd of this year. Ask yourself these questions to determine the rationality of the bill:

    â?¢ Why was it so critical to use the controversial budget process (Reconciliation) to circumvent normal Congressional procedure to get the bill passed because our economy was going to fall off a cliff when most major benefit provisions do not kick in until 2014?
    â?¢ Why are we paying taxes for benefits that do not kick in until 2014?
    â?¢ Why donâ??t most of the reform provisions kick in until 2014 (two years after the next Presidential election), but some of the initial provisions kicked in on September 23rd, 2010 (less than two months before the mid-term elections)?
    â?¢ With roughly 80% of the people in the United States (over 250 million) already having some kind of health insurance coverage, where were they during the townhall meetings, and propaganda positioning that was used to sell the bill to the American people? There were (and still are) plenty of stories about financial hardships caused by not having health insurance, but where were the success stories about someone who encountered a health claim, had it processed by their insurance carrier on a timely basis, and paid exactly according to plan? None of these people exist?
    â?¢ Why such a major overall to accommodate such a minority?
    â?¢ Why was the new head of Medicare and Medicaid, Dr. Donald Berwick, an advocate for Great Britainâ??s socialized healthcare system slide into that position by President Obama with a recess appointment in July without scrutiny?
    â?¢ When â??Healthcare Reformâ?? was one of the biggest Presidential campaign promises, and is one of the most major accomplishments in President Obamaâ??s presidency to date, why are no Congressmen running on the success of that reform that they voted for during their mid¬term election campaigns?
    â?¢ Does it upset you that your elected officials voted on a 2,000+ page bill that will affect 17% of GDP without even reading it?
    â?¢ What credible track record does the federal government have on its resume that would make someone feel comfortable that they can enter into the private sector, dictate what health benefits need to be covered, and how much money an insurance carrier needs to pay out for those benefits?
    â?¢ Why were the majority of people against this bill, and still the majority favor repeal?
    â?¢ If the new law is declared constitutional, what will be the next thing that the federal government mandates you to buy?
  • Gouged
    Anthem's new game is to increase the cost of prescription drugs across the board. Our co-pays on drugs increased an average of 50% and that's the good news. For a 'specialty drug' like Avonex the co-pay is 50% of the cost of the drug! Anthem has the exclusive right to set drugs in the appropriate tier so to garner more prescription dollars they just bump up the tier for that drug.
  • Understanding risk
    Nobody likes being gouged. Most individual policyholders(i.e. not in employer-sponsored programs)are paying unreasonably high premiums for a number of reasons, and I certainly would not deny greed to be among them. But, healthcare providers also pass through the cuts in Medicare/Medicaid reimbursement rates (read government), to private payors, so it's more complicated than the usual populist viewpoint makes it out to be.

    For an insurer, assessing risk involves quantifying the liklihood and cost of future claims. Pre-existing conditions are part of that measurement, and ultimately, cost, whether the insurer pays or the government (read the taxpayer) does. Simply put, nothing is free.

    Following some of the views expressed here, a car insurance company should not be able to decline to offer liability coverage to a driver with a pre-existing condition, such as multiple DWI's. Would anyone argue that we should all pay more for car insurance so we can make sure there is coverage for all of the drunks on the road?

    The public option does not eliminate these costs, it only shifts them to another payor (us). Besides, the public option never was about cost -- it was about government control and organized labor -- and those two bodies have never reduced the cost of anything of which I am aware.

  • Arrogance
    This is a continued display of arrogance and greed. The biggest mistake was allowing the takeover of the not for profits like Blue Cross Blue Shield by the greedy corporate world. Government's solution was to allow 4 years prior to any significant controls put in place. By then the rates will be so high that it won't matter. A government plan would not be any improvement as has been proven often.
  • This is the staus Quo
    This is what the GOP and the Republicans want. The denials were not part of the health care plan as the report goes back to 2007 to 2009. Guess what GOP, your doublespeak lies about healthcare rising because of the Health Care Reform does not hold water. provisions were put in place to appease the GOP and all it does is allow insurance companies to do as they please to amass some panic and anger to eventually get what they want and to heck with the American public.
  • this is why
    The only way to avoid these shenanigans is to adopt the public option. People who oppose it would rather trust their luck and that of their loved ones, rather than allow others they see as unworthy in some way have access to health care.
    • this is why
      The only way to avoid these shenanigans is to adopt the public option. People who oppose it would rather trust their luck and that of their loved ones, rather than allow others they see as unworthy in some way have access to health care.

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